10am ET: Amid the searing heat of a Washington summer and swarms of police and Secret Service vehicles around the centre of the city, the latest round of Middle East peace talks are formally underway.

You can tell it's Middle East peace talks at the State Department from the presence of bomb-sniffing dogs and long lines to get through security. Computers have to be opened and placed on the ground for the dogs to sniff – and given that they are journalists' laptops, the greatest security threat may be to the health of the sniffer dogs from the toxic keyboards.

Israel's prime minister, Binyamin Netanyahu, has said he is looking "to find a historic compromise" that will bring peace to the Middle East for generations as he begins direct talks with the Palestinian leader, Mahmoud Abbas, in Washington today.

Today's talks are the first since the last peace effort foundered in December 2008, and take place against a background of violence in the West Bank and Israeli settlement activity. As a result, expectations are low and the US is setting its sights on an agreement to hold a second round of negotiations as a mark of success.

10.22am ET: The first official public act begins: at the State Department, the US Secretary of State Hillary Clinton opens proceedings with a statement:

"I look around and I see veterans. We've been here before and we know how hard this will be."

Looking at Netanyahu and Abbas, seated around her at the U-shaped conference table, Clinton said: "You each have taken an important step toward freeing your peoples from the shackles of a history we cannot change."

Things will "get no easier if we wait, nor will they resolve themselves" says Clinton, warning of "all the long days" that will follow if the peace talks are to proceed.

10.29am ET: Clinton is making no bones that the chances of success from these talks are slim.

"I want to conclude by saying a few words directly to the people of the region," says Clinton, telling them "you are the ones that will ultimately decide the future."

"For the effort to succeed we need your support and your patience ... we cannot do this without you."

10.33am ET: Now Israel's Benjamin Netanyahu is speaking. So far, diplomats have been struck by the force of Netanyahu's insistence yesterday that he wants to find an historic compromise. But they remain sceptical about whether he has the will and the ability to do so.

"We have to get from disagreement to agreement, that's a big task," says Netanyahu, who refers to the "two pillars of peace": legitimacy and security.

"Just as you expect us to recognise the Palestine as the nation state of the Palestinian people, we expect you to recognise Israel as the nation state of the Jewish people."

Netanyahu refers to Clinton's remark about the "veterans" of Middle East peace talks, and the 12 years he has been involved in them, but then talks about what has changed in recent years, especially the influence of Iran.

10.38am ET: Netanyahu:

"President Abbas, history has given us a rare opportunity to end the conflict between our two peoples, a conflict that has been going on for more than a century."

Netanyahu then quotes from the book of Genesis, the story of Isaac and Ishmael joining together to bury their father Abraham in Hebron, and concluding:

"I can only pray, and I know that millions around the world ... pray that the pain that we have experienced, you and I, in the last 100 years of conflict, will unite us not only in a moment of peace around a table of peace here in Washington, but will enable us to leave from here and forge a lasting peace for generations."

10.40am ET: Now Palestinian President Abbas speaks. After a preamble, Abbas calls for Israel to stop building settlements on the West Bank and to end its embargo imposed on Gaza.

Abbas then talks about efforts the Palestinian Authority has been taking to find the terrorists who killed four Israeli settlers yesterday, and the police work and arrests that have followed.

Abbas then said "the goals are clear" and the path to an enduring peace is known to both sides – and that means it should be possible to achieve a final peace agreement within the year-long table favoured by the US sponsors:

"We do know how hard are the hurdles and obstacles we face during these negotiations – negotiations that within a year should result in an agreement that will bring peace."

10.49am ET: Back to Clinton, who wraps up the opening remarks:

"Now it's time to get to work."

10.55am ET: The Guardian's Chris McGreal is at the State Department in Foggy Bottom, and he listened to the statements from Clinton, Netanyahu and Abbas in the conference room just now. Here's his take:

I thought it was interesting Netanyahu said that if the issues of recognition of Israel as a Jewish state and security were agreed, everything else was doable. That suggests he's prepared to make the necessary sacrifices on settlements, East Jerusalem, the borders, etc. But whether the sacrifices he has in mind meet Palestinian expectations is another matter.

The security issues will not be easy, either. Netanyahu made reference to rockets coming from Gaza. What the Israeli have in mind to ensure there is no such threat from the West Bank is not clear

11.32am ET: As usual, the peace talks are being covered in minute detail by the Israeli press. Writing in Haaretz, Avi Issacharoff has a positive view of Mahmoud Abbas's track record as president:

Abbas' control may not extend to Gaza, but in the West Bank he has engineered a revolutionary transformation. Lacking Arafat's much-touted charisma, Abbas has quietly, obstinately changed the very face of the territory. Along with Palestinian Prime Minister Salam Fayyad, he has created a new way of life for the Palestinians. The armed men have disappeared, and West Bank cities for the first time know law and order. And yes, the number of terror attacks against Israelis has plummeted.

Issacharoff's conclusion about the chances of success at the peace talks:

The Netanyahu government must understand the price of ending the conflict. You want peace? Give Abbas the Temple Mount. Without Islamic sovereignty over what Muslims call the Haram al-Sharif, we won't have peace even a decade from now.

12.15pm ET: Robert Gibbs, the White House press secretary, answers a few questions about the state of the Middle East peace talks during his daily televised press briefing.

After some talk about approaching Hurricane Earl and today's oil rig explosion in the Gulf, Gibbs is asked if Obama is more optimistic about the prospects, given recent stability in the area.

"The president felt the meetings yesterday were productive and believed that each of the leaders were genuine and serious about seeking peace," responds Gibbs, giving nothing away. But Middle East peace has "eluded generations, we're mindful of that."

Gibbs is asked if the threat to all parties from a nuclear armed Iran was concentrating the minds of participants, including the Palestinians. Gibbs won't go down that road: "We have always maintained that peace was in the best interests of all of these entities involved, regardless of anything else in the Middle East."

But the rest of the White House corpse – sorry, corps – are more interested in asking about the up-coming 2010 midterms and how badly the Democrats are likely to do.

12.30pm ET: The US's special Middle East peace envoy George Mitchell gave a briefing before the peace talks started, in which he was asked about the role of Hamas, on the grounds it would be "the elephant in the room" during the discussions. Mitchell responded:

We do not expect Hamas to play a role in this immediate process. But as Secretary of State Clinton and I have said publicly many times, while in the Middle East and in the United States, we welcome the full participation by Hamas and all relevant parties once they comply with the basic requirements of democracy and nonviolence that are, of course, a prerequisite to engage in these serious types of discussions.

Mitchell then raised the issue of comparing Hamas to the IRA, given his long involvement in the Northern Ireland peace process:

There has been a good deal of a discussion about references to Northern Ireland, and I have repeatedly been asked by reporters and individuals when I make public appearances, well, Senator, you talk to the IRA in Northern Ireland, but don't you talk to Hamas here. The questions reflect an incomplete understanding of what occurred in Northern Ireland and its relationship to this situation.

So, first, let me say they're very different. It's not useful to try to make direct comparisons because the participants, the circumstances, the situation, the timing are all very different. And while we should learn what we can from other processes, each is unique.

But on the central point, the reality is that in Northern Ireland, Sinn Féin, the political party that is affiliated with the IRA, did not enter the negotiations until after 15 months had elapsed in the negotiations, and only then because they met two central conditions that had been established. The first was a ceasefire, and the second was a publicly stated commitment to what came to be known as the Mitchell Principles because I was the chairman of the commission that established them.

1.05pm ET: Breaking news There are reports that Israeli and Palestinian leaders have agreed to hold a second round of peace talks on 14-15 September.

More details when we get them, but this is encouraging, given that the US had hoped for at least this much.

1.25pm ET: More details now emerging on the agreements for a further round of talks. The US special envoy George Mitchell has announced that Israeli prime minister Benjamin Netanyahu and Palestinian president Mahmoud Abbas have agreed to a second round of talks to take place 14-15 September in the Middle East – probably at Egypt's Sharm el-Sheikh resort region on the Sinai peninsula.

Mitchell also said they would meet every two weeks after that.

Sharm el-Sheikh was the site of talks in 1999, as was nearby Taba in 2001.

1.50pm ET: Further details emerging from the peace talks this morning, with George Mitchell speaking to reporters at the State Department where the talks are taking place:

"I believe these two leaders – President Abbas and Prime Minister Netanyahu – are committed to doing what it takes to achieve the right results."

Mitchell said the two sides are working on a framework agreement for on-going talks, without giving details, although he said the agreement would describe the "fundamental compromises" that would be needed.

On the table is likely to be the list of issues that have been long familiar: Israel's security, East Jerusalem, Palestinian refugees and of course the question of borders and settlements.

Mitchell said he and Hillary Clinton would attend the next round of talks later this month.

2.19pm ET: More on the framework agreement that the Israeli and Palestinian leaders are thrashing out today. The Associated Press reports:

Though "less than a full-fledged treaty," [US peace envoy George] Mitchell said the framework would "establish the fundamental compromises necessary to enable the parties to then flesh out and complete a comprehensive agreement that will end the conflict and establish a lasting peace."

How long will that take? According to Mitchell, the goal is to "resolve all of the core issues within one year".

Diplomats said they were surprised by the strength of Netanyahu's insistence that he is committed to making an "historic compromise" in search of a durable peace settlement.

But the difficulties of agreeing that compromise were highlighted after Netanyahu's defence minister, Ehud Barak, said the day before the talks that Israel could meet a Palestinian demand to divide Jerusalem so that the mainly Arab east of the city can become a Palestinian capital.

"The Arab neighbourhoods in which close to a quarter million Palestinians live will be theirs," Barak told Haaretz newspaper.

One of Netanyahu's aides immediately contradicted Barak, saying the prime minister's position at the talks will be that the city must remain fully under Israeli control.

"Our position is that Jerusalem will remain the undivided capital of Israel," the aide said.

3pm ET: So far, there has been some surprise at how dovish Benjamin Netanyahu has sounded in Washington. One veteran observer of Israeli politics writes to suggest:

"I wonder if Netanyahu isn't sincere in his own mind, that he's made the leap and recognises Israel has to give up territory. But I wonder if he's fully grasped how big the compromises will have to be."

Netanyahu is sending all the right messages but will that translate into action? Then the question is: even if he does, can he carry it through politically?

3.11pm ET: The New York Times raises an interesting point about the consequences of the timing of the second round of talks, agreed on earlier today. The next round will take place on 14-15 September:

That would mean that a successive round of talks would fall just days after an Israeli freeze on new construction in the occupied West Bank is set to expire. Mr Netanyahu has said he will not renew it; Mr. Abbas has hinted he cannot continue talking without an extension; efforts at a compromise were thus certain to be a central topic in Washington.

3.20pm ET: Here's a first look at an article on the peace talks by Chris McGreal that will be appearing in tomorrow's Guardian print edition:

For many diplomats though the great unanswered question at the talks was which Binyamin Netanyahu would be at the table. Fourteen years ago the same Israeli prime minister seemed determined to kill any peace deal at talks with Yasser Arafat overseen by Hillary Clinton's husband and then president, Bill Clinton.

Yesterday Netanyahu's language was of historic compromises and repeatedly calling the Palestinian leader, Mahmoud Abbas, his "partner for peace" went further than many expected.

Diplomats had expected the Israeli prime minister to pay lip service to a peace deal and even to make some significant concessions. What they had not expected was the repeated pledges to peace that poured forth after Netanyahu's meeting with Barak Obama on Wednesday and again yesterday before the talks.

Middle East peace talks in Hillary Clinton's office this morning. Photograph: US State Department US State Department/Public domain

4pm ET: No new developments but the State Department has posted a photo (above) of a meeting this morning in Hillary Clinton's office between (from left) Abbas, Netanyahu, Mitchell and Clinton, in which all the participants appear relaxed.

5pm ET: There will be no official word on when the talks have ended, the State Department says, allowing them to go on as long as the parties require.

Here's how the Israeli press is reacting to today's mildly positive events.

The talks began with public statements by Clinton, Netanyahu and Abbas in the Benjamin Franklin Room at the State Department before the three held a plenary session with their staffs, and then broke into a smaller session consisting of Clinton, Mitchell, Netanyahu and Abbas, with chief negotiators Yitzhak Molcho and Saeb Erekat, in her private office.

After that, Netanyahu and Abbas held a one-on-one discussion for two full hours before being rejoined by their staffs.

After that meeting, senior officials quoted Netanyahu as saying that there was no substitute for direct meetings between leaders to solve key problems.

Israeli and Palestinian leaders agreed Thursday to produce a framework for a permanent peace deal and to hold a second round of direct talks this month followed by regular meetings, a modest achievement reached amid deep skepticism about success at their first such session in two years.

5.30pm ET: There is one potentially very interesting late snippet from Haaretz, the Israeli newspaper, which is running the headline: "Source in PM's delegation: Netanyahu considering referendum on peace deal".

Conclusion: On the basis that no news is good news, things have obviously gone along swimmingly today. The huge motorcade that zipped past the Guardian's office towards the White House just now suggests that the peace talks may have indeed concluded.

In summary:

• Israel and Palestine leaders agreed to meet again on 14-15 September

• Negotiators to develop a framework agreement for on-going talks

• Second round of talks to be in the region, with Clinton and Mitchell attending

• Netanyahu and Abbas agree to regular meetings every two weeks

It seems that talks that began with very low expectations of success have succeeded by exceeding those expectations. In particular, Netanyahu has set a moderate and conciliatory tone.

Netanyahu's next cabinet meeting could be the key moment in determining whether these talks can move forward or not.